Publication: Rethinking Lagging Regions: Using Cohesion Policy to Deliver on the Potential of Europe's Regions
Loading...
Published
2018
ISSN
Date
2018-05-15
Author(s)
Editor(s)
Abstract
As the World Bank’s 2012 Golden Growth report emphasized, the European Union, since its founding, has been a ‘convergence machine,’ generating wealth and a higher quality of life for the poorest in the 28 EU member states. More recently, the Growing United report highlighted that while the convergence machine still works, it is not working for everyone. And among the fault lines emerging in the convergence machine, regional inequality represents a potent threat to Europe’s economic well-being, and to its social and political cohesion. In this context, Rethinking Lagging Regions highlights the nature and implications of regional inequalities in Europe and recommends how cohesion policy can be leveraged to maximize its impact on lagging regions, and on the businesses and people in these regions. The report has several key messages: regional inequalities are high and likely to rise; Europe’s lagging regions are going in opposite directions, but face common challenges; cohesion policy can maximize its impact on lagging regions by explicitly targeting regional potential and equality of opportunity rather than convergence; cohesion policy priorities can be rebalanced to help deliver on regional potential; and delivery of regional policy needs to engage ever more deeply at the ground level. This report aims to contribute to the debate on the future of cohesion policy, with a specific focus on lagging regions. It calls for a further shift in the objectives of cohesion policy towards an increasingly ‘region-centered’ approach that aims to maximize potential in all regions, while seeking convergence of opportunities for individuals, no matter where they live.
Link to Data Set
Citation
“Goga, Soraya; Farole, Thomas; Ionescu-Heroiu, Marcel. 2018. Rethinking Lagging Regions: Using Cohesion Policy to Deliver on the Potential of Europe's Regions. © World Bank. http://hdl.handle.net/10986/29823 License: CC BY 3.0 IGO.”
Digital Object Identifier
Associated URLs
Associated content
Other publications in this report series
Journal
Journal Volume
Journal Issue
Collections
Related items
Showing items related by metadata.
Publication Magnet Cities(World Bank, Bucharest, 2017)Romania is the fastest growing economy in the European Union (EU), and Bucharest and Romania’s secondary cities have been its main growth engines. However, while Bucharest has reached productivity levels comparable to those of other EU capitals, secondary cities in Romania still have some ways to go before competing on equal footing with secondary cities in the EU. Without strengthening these secondary cities, the Romanian economy cannot sustain growth in the coming years. The most competitive secondary cities are those that are most astute at attracting people, investments, and tourists. This report looks at the cities that have been most successful at attracting migrants and commuters, and proposes a number of recommendations aimed at making secondary cities more attractive and competitive. The report is primarily addressed to policy makers and to a lay audience interested in urban development issues.This report is structured along four main sections: 1) An analysis of development dynamics, with a particular focus on the importance of cities in driving growth and development; 2) An analysis of migration and commuter patterns in Romania; 3) An analysis of the cities and areas that have been most successful at attracting people, and an analysis of the urban areas that will likely attract most people in the future. 4) Recommendations on how EU, national, and local policies and investments can help make secondary cities more competitive.Publication The Internal Geography of Trade : Lagging Regions and Global Markets(Washington, DC: World Bank, 2013-04-08)Economic theory, including endogenous growth, the role of institutions, and, most importantly, the New Economic Geography (NEG), have made significant progress in explaining the emergence of core-periphery patterns behind this divergence. They point to the critical role of agglomeration, which confers benefits to metropolitan cores that have the advantages of large markets, deep labor pools, links to international markets, and clusters of diverse suppliers and institutions. Regions relatively near the metropolitan core are likely to benefit from spillovers and congestion-related dispersion. Regions further outside the core however, are not only less able to take advantage of spillovers, but also more likely to be far removed from key infrastructural, institutional, and interpersonal links to regional and international markets. As a result, they face significant challenges to becoming competitive locations to host economic activity. Thus the geographical pattern of core and peripheral regions is increasingly manifest in an economic pattern of 'leading' and 'lagging' regionsPublication Integrating Border Regions : Connectivity and Competitiveness in South Asia(World Bank Group, Washington, DC, 2014-07)Deeper regional integration can be beneficial especially for regions along international borders. It can open up new markets on opposite sides of borders and give consumers wider access to cheaper goods. This paper uses data from five contiguous districts of India, Nepal, and Bangladesh in the northeast of the subcontinent to measure the degrees of trade complementarity between districts. The paper illustrates that the regions are underexploiting the potential of intraregional commerce. Price wedges of up to 90 percent in some important consumption products along with measures of complementarity between households' production and consumption suggest the potential for relatively large gains from deeper trade integration. Furthermore, an examination of a specific supply chain of tea highlights factors that help industries scale up, aided by institutions such as an organized auction and decent physical and legal infrastructure. However, districts alike in geography but located across international boundaries face different development prospects, suggesting that gains from reduced "thickness of borders" would not accrue automatically. Much rests on developing intrinsic industry competitiveness at home, including the reform of regulatory and business practices and infrastructural bottlenecks that prevent agglomeration of local economies.Publication Shifting Patterns of Economic Growth and Rethinking Development(World Bank, Washington, DC, 2012-04)This paper provides an historical overview of both the evolution of the economic performance of the developing world and the evolution of economic thought on development policy. The 20th century was broadly characterized by divergence between high-income countries and the developing world, with only a limited number (less than 10 percent of the economies in the world) managing to progress out of lower or middle-income status to high-income status. The last decade witnessed a sharp reversal from a pattern of divergence to convergence --particularly for a set of large middle-income countries. The latter phenomenon was also driven by increasing economic ties among developing countries, and on the intellectual scale, increased knowledge generation and sharing among the developing countries. Re-thinking development policy implies confronting these realities: 20th century economic divergence, the experience of the handful of success stories, and the recent rise of the multi-polar growth world. The paper provides descriptive data and a literature survey to document these trends. The paper also provides a brief survey of the role of multilateral institutions -- in particular, the World Bank -- in this changing context and offers suggestions on how they can adapt their strategies to improve development outcomes.Publication Pathways from Jobs to Social Cohesion(World Bank, Washington, DC, 2014-03)There is growing recognition that access to good jobs is an important driver of social cohesion. While economic dimensions of labor market outcomes are relatively well documented, evidence on the link between social cohesion and jobs is still surprisingly scarce. This paper, based on an earlier background report for the WDR 2013, presents empirical evidence for pathways between labor market outcomes and social cohesion. The findings indicate that formal employment is associated with a range of social outcomes and behaviors that are typically associated with higher levels of social cohesion. However, there are also indications that this relationship varies across dimensions of social wellbeing. In particular social interactions and political activism among those in regular employment can either improve the quality of aggregate institutions or deepen existing social divides.
Users also downloaded
Showing related downloaded files
Publication Guinea-Bissau Country Climate and Development Report(Washington, DC: World Bank, 2024-10-23)Guinea-Bissau is endowed with a wealth of natural resources, with the highest natural capital per capita in West Africa (US3,874 dollars per capita), which could be leveraged for sustainable and resilient growth. However, Guinea-Bissau faces significant development hurdles, such as high poverty rates, political instability, and economic challenges, including an over-reliance on cashew nuts. Rural poverty has increased, and the nation's infrastructure, education, and health care systems are underdeveloped. Climate change poses a severe threat, potentially impacting agriculture, fisheries, and infrastructure. Without adaptation, it could lead to a significant cut in real GDP per capita (minus 7.3 percent by 2050) and increase in poverty (with up to over 200,000 additional poor by 2050, that is, 5 percent of the expected population, in the worst scenario). The country's low greenhouse gas emissions are expected to rise, mainly due to agriculture and land-use changes, with deforestation being a major contributing factor. Although Guinea-Bissau is a low emitter, it has high mitigation ambitions, targeting a 30 percent reduction in greenhouse gas emissions by 2030. The Nationally Determined Contribution outlines significant climate actions, with initiatives focused on forest conservation, sustainable agriculture, and community development. However, the country's political instability, institutional weaknesses, and limited financial resources pose challenges to implementing these climate commitments, which depend heavily on external funding. The financial sector's underdevelopment and vulnerability to external shocks limit its ability to support green investments, though reforms could enhance resilience. Guinea-Bissau must consider its climate financing as development financing and vice-versa, engage the private sector, and integrate climate goals with national development plans to ensure a sustainable future. Concessional climate financing is vital due to the underdeveloped financial sector and the government’s limited borrowing capacity. Addressing Guinea-Bissau's vulnerability to climate change and its structural issues requires a cohesive approach that integrates development and climate strategies. This could involve improving governance, diversifying the economy, protecting natural capital, developing human capital, and investing in sustainable agriculture and infrastructure. The transition to a more sustainable and inclusive development pathway that supports economic growth is possible, but requires focusing on key strategic sectors, enhancing institutional capacity, and creating the conditions to mobilize finance. As a highly vulnerable country, there are myriad needs in the different sectors; however, to be more efficient and effective, Guinea-Bissau should prioritize actions in a few sectors, especially actions on biodiversity, agriculture, and social protection. Low carbon development, especially in energy and forestry sectors, could provide cost-efficient solutions and attract climate finance, including from the private sector, which will support the overall development agenda.Publication Comoros Country Climate and Development Report(Washington, DC: World Bank, 2025-06-18)The Union of the Comoros (The Comoros) has significant vulnerability to climate change-related risks but has considerable opportunities to strengthen preparedness and resilience against these challenges. According to the Notre Dame Global Adaptation Index, the Comoros is the 29th-most vulnerable country to climate change and the 163rd most ready to adapt (out of 191). The Comoros archipelago is exposed to many natural hazards that adversely affect the country’s natural capital, people, and physical infrastructure. In 2014, the economic cost of climate-related disasters was estimated at 5.7 million dollars annually, equivalent to 9.2 percent of Gross Domestic Product (GDP). Between 2018 and 2023, as many as 11 tropical depressions or cyclones impacted the country, with Cyclone Kenneth causing the greatest damage, equivalent to 14 percent of GDP, resulting in total economic growth falling from 3.6 percent in 2018 to 1.9 percent in 2019. More than 345,000 people (40 percent of the population) were affected by the cyclone, with 185,000 people experiencing severe impacts and 12,000 people displaced. However, there is an opportunity for the country to grow more robust and shock-responsive, and to establish pre-positioned funding mechanisms to enhance future crisis response efforts. For the Comoros, adaptation and climate-resilient development are the key climate change focus areas, with the country projected to face 836 million dollars 2050 in additional costs due to climate-related impacts. Current plans to adapt to the impacts of climate change in the Comoros include efforts to improve water management, strengthen coastal protection, and develop climate-smart agriculture practices. Given the country’s reliance on its natural resource base for economic growth and mobility, protection of these resources from climate change will be essential for promoting resilient growth and development. In addition to growing the adaptive capacity of the country’s natural resource sectors, strategic economic diversification will be important to help minimize future climate impacts, and development activities will need to be undertaken in such a way as to attract low-carbon co-benefits. The Union of the Comoros is committed to addressing climate change through its Nationally Determined Contribution (NDC) and national priorities. The country’s NDC (which was revised in 2021 for a ten-year horizon) sets ambitious targets, with a goal of reducing greenhouse gas emissions by 23 percent by 2030. The country also plans to significantly increase the share of renewable energy in its energy portfolio, reaching 33 MW by 2030. This will not only promote low-carbon development but also reduce the country’s dependency on imported oil and coal, which currently make up 95 percent of the energy mix. Additionally, the Comoros has declared its intention to increase CO2 removals by 47 percent by 2030, compared to BAU.Publication Mongolia Country Climate and Development Report(Washington, DC: World Bank, 2024-10-22)Mongolia’s development prospects are uniquely challenged by both the impacts of climate change and the global shift toward a low-carbon economy. The country’s efforts toward decarbonization pose significant challenges given the structurally high-emission intensity of its economy. While challenging, climate action also presents Mongolia with opportunities to achieve important development benefits. The effects of climate risks and the shift away from coal will have diverse impacts across different regions, communities, and socioeconomic levels. The report assesses the critical interconnections between Mongolia’s development ambitions and climate change action and identifies ways to transition to a more economically diversified, inclusive, and resilient development path. It highlights key climate and transition risks affecting Mongolia’s future development and presents a pathway to enhance climate mitigation and adaptation. The report also makes a case for strengthening policies to enhance resilience to climate change and ensure a just transition, particularly for the most vulnerable. The report is structured as follows: section 1 gives introduction. Section 2 delves into the linkages between development and climate in Mongolia and presents model-based findings on the economic and poverty impacts of climate change under different scenarios. Section 3 covers four in-depth sectoral analyses. The first two mainly focus on adaptation to climate change in the agriculture and water sectors. The third considers prospects for the extraction sector, while the fourth sectoral analysis focuses on decarbonizing power and heat generation. Section 4 shifts the focus to how the government can boost resilience for climate-vulnerable populations. Section 5 outlines options for mobilizing private and public financing and private investments to support the green transition. Section 6 examines the existing institutional and governance structure for climate action and presents recommendations to improve its effectiveness, and section 7 concludes with a framework for prioritizing the policy actions outlined in this report.Publication Jobs in a Changing Climate: Insights from World Bank Group Country Climate and Development Reports Covering 93 Economies(Washington, DC: World Bank, 2025-11-05)The World Bank Group’s Country Climate and Development Reports (CCDRs) provide a crosscutting look at how countries’ development prospects, and the job opportunities they offer to their people, can be threatened by climate impacts and supported by climate policies. Climate change and policies affect jobs through impacts on productivity, energy and material efficiency, and physical, human, and natural capital. They can also transform employment opportunities, especially through complementary measures that help workers and firms adapt to and benefit from new technologies and production practices. Prepared by the World Bank, the International Finance Corporation (IFC), and the Multilateral Investment Guarantee Agency (MIGA), CCDRs integrate country perspectives, climate science and economic modeling, private sector information, and policy analysis to assess how countries can successfully grow and develop their economies and create jobs despite increasing climate risks and while achieving their climate objectives and commitments. Each CCDR starts from the country’s development priorities, opportunities, and challenges, and is developed in close consultation with governments, businesses, and civil society, ensuring the recommendations reflect national priorities. By combining evidence on adaptation, resilience, and emissions pathways, CCDRs highlight where climate action can reinforce development and job creation, and where targeted policies are needed to manage risks and smooth labor market transitions. Taken together, these elements can help create local jobs, ensure economic transitions are just and inclusive, and equip workers and firms to navigate the disruptions and opportunities of a changing climate and changing technologies.Publication Kyrgyz Republic Country Climate and Development Report(Washington, DC: World Bank, 2025-11-03)This Country Climate and Development Report (CCDR) on the Kyrgyz Republic aims to support the country’s development goals amid a changing climate. The CCDR considers two policy scenarios up to 2050: the business-as-usual (BAU) and high-growth scenarios. As it quantifies the likely impacts of climate change on the Kyrgyz economy between now and 2050, the report highlights key government actions to best prepare for and adapt to climate impacts (referred to as “with adaptation” measures), with a particular focus on the time horizon up to 2030. The CCDR also outlines a path to net zero emissions by 2050 (referred to as “with mitigation” measures, “decarbonization,” or, simply, “net zero 2050”), highlighting associated development co-benefits.